Investing money !

Off-Topic | Feb 14, 2017

  1. KF81

    KF81

    KF81

    166 posts
    Since Feb 19, 2015
    Hellooo,

    I was just wondering if anyone knows anything about investing money, stocks ect..

    I guess if it was that easy to invest money and make decent returns everyone would be doing it !

    But, in all honesty, i do not have a clue.

    Do individuals deal in stocks, shares and investments ect ?

    Can or do people make a living out of doing it, is it a good living ?

    I am just curious really.

    I do have £8000 that my Mum left me when she died and i was wondering, how could i use that money to make more money !

    Cheers..
  2. elbarto

    elbarto

    elbarto

    273 posts
    Since Mar 1, 2013
    I would check out reddit.com/r/ukpersonalfinance rather than Dogs On Acid mate.
  3. tiffanydrake likes this.

    Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    Simple answer:

    - When you buy any financial asset (currency, bond, stocks) there has to be a seller.
    - When you sell, there has to be a buyer.

    So if you take a trading platform where people buy and sell, and bet on prices going up and down, if you think buyers and seller always cancel each other out perfectly, then between them all they make nothing (we call it a 'zero sum game') .. But they all pay dealing charges.

    So the simple solution is just to buy exposure to the market (e.g. an index fund tracking the US or global Stock Market – I'd suggest a Vanguard open-ended fund, like Lifestrategy 80) and hold it long-term, where it hopefully appreciates in value as the global economy increases in productivity.

    No guarantee it will. But historically it generally has over 20 or 30 year periods.

    It's not what I do. I run a hedge fund and make about 20-30% annually. But the longer I do it, the harder I realise it is to quantify what it is I do in a way other people could follow.
    tiffanydrake likes this.
  4. Robbbo Expansion always, in all ways

    Robbbo

    Robbbo Expansion always, in all ways

    479 posts
    Since Aug 20, 2016
    8000 is a great start.

    Sordid Double Life, Ray Dalio and co will have plenty to say on the matter.

    I invest directly in my local sharemarket (NZ) with a little bit in a S&P 500 index (through an instrument that is tied to the NZ stock exchange). I'm fairly financially illiterate and do it largely by feel but I have managed to achieve a decent return over the term I've been investing (about 10 years).

    I've got a fair bit of cash sloshing around at the moment but I'm struggling to find a place to put it. Everything on the NZ market is quite expensive.
  5. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    We're quite late in the business cycle. There's virtually no value anywhere (without risk), so it's more a case of playing macro trends or trend-following.

    I still like the Russian stock market (mostly a play on oil) and high-yield bonds.
  6. 00Monarc I make neurofunk Garbage.

    00Monarc

    00Monarc I make neurofunk Garbage.

    351 posts
    Since Jun 30, 2015
    I deposit my savings into an investment firm that uses a computer algorithm to trade stocks across any market that's happening to be doing well. I get interest from that.
    I forget what kind of trading that is.
  7. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    Sounds like systematic trend-following.. But most firms who offer to do that are just conmen.

    In principle, if anyone can do that reliably, they don't need your money..
  8. 00Monarc I make neurofunk Garbage.

    00Monarc

    00Monarc I make neurofunk Garbage.

    351 posts
    Since Jun 30, 2015
    It's my friends firm. It's doing quite well in my city.

    The money is stored in a Tax haven account and the return interest is high.
  9. Jimmy Crack likes this.

    MiL0

    MiL0

    MiL0

    15,826 posts
    Since Jan 25, 2002
    Meh, I don't rate share trading at all. Without showing off (too much), I invested £10,000 in 2009 and (after tax and all my debts are paid off) now have well over £250,000 in assets, just from that one investment that I made 8 years ago. On top of that these (multiple) assets generate a decent and passive income.

    All we really need is clothes, food and a roof over our heads. I don't like clothes and the restaurant business is fucking hard work. This leaves property. And you can't sleep inside a share or stock.
    Jimmy Crack likes this.
  10. MiL0 likes this.

    Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    Hitting a 20-bagger on a single investment is basically luck .. Great if you get a 2,000% return – not so great if it goes to 0 .. Do it 10 times in a row and you get the right to brag.

    Owning financial assets is prudent .. With more and more work becoming automated, there's absolutely no guarantee some government or big corporation is going to feel obliged to fund your lifestyle in 10-20 years time.

    But own businesses that benefit from automation, and you'll own a piece of each of those robots/AIs, and it'll pay you a piece of everything it earns.. The only aim of earning money should be to own a greater piece of the economy.
    MiL0 likes this.
  11. Visceral

    Visceral

    Visceral

    1,489 posts
    Since Aug 14, 2007
    I have over a hundred g invested in forex trading as well as a few shares, I take a good 25% p.a. out and live off that while I am at uni. There are "professional traders" that you can find that make a living off taking a percentage of what you make out of the profit. The hard part is finding them, and finding ones that don't want to fuck you over. The only reason I have done this successfully over the past 4 years is family connection to a trader. The other issue is "seed capital". If you only start with $1000 then you will only be making $250 a year and that is if things go smoothly!
  12. eventualdecline Smothered Hope

    eventualdecline

    eventualdecline Smothered Hope

    10,041 posts
    Since Sep 4, 2001
    There's no significant value in delivering automation, that's a pure optimisation play. The real value is in (good) data.
  13. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    I'm not talking about investing in robotics .. Automation's going to replace jobs in every sector, so by owning the market you're going to own a share of the robots that are going to replace you.

    Rio Tinto's probably the most significantly automated company in the FTSE100, and that's in the mining sector.

    Re: data .. Not sure if there's a business model there yet. Hedge and private equity funds are buying up these nonpublic companies before you'd get a look in. Anything worthwhile will probably wind up being bought by Apple, Google, Facebook.. Again, I wouldn't speculate – 9 times out of 10, if you've had an idea, the market's already put it on a silly premium. Those who benefit the most are probably going to be firms like Unilever and Amazon anyway.
  14. Visceral

    Visceral

    Visceral

    1,489 posts
    Since Aug 14, 2007
  15. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    They were being used in the 80s.
  16. Visceral

    Visceral

    Visceral

    1,489 posts
    Since Aug 14, 2007
    then what i said is not incorrect? Yo guys were the ones talking about robotics so i thought i would bring it up
  17. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    Well you'll know better next time.
  18. Tranzitive

    Tranzitive

    Tranzitive

    1,004 posts
    Since Feb 7, 2007
  19. eventualdecline Smothered Hope

    eventualdecline

    eventualdecline Smothered Hope

    10,041 posts
    Since Sep 4, 2001
    Neither am I.
  20. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    What are you talking about then? And what Bloomberg article did you read about it in?
  21. eventualdecline Smothered Hope

    eventualdecline

    eventualdecline Smothered Hope

    10,041 posts
    Since Sep 4, 2001
    I work in one aspect of the automation industry and I'm based in silicon valley. I pay a reasonable amount of attention to the startup community around me and I see what people are investing in and where other businesses are failing.
  22. Sunder likes this.

    Yalla

    Yalla

    Yalla

    1,822 posts
    Since Jul 1, 2016
    I engage in the occasional bank heist, but lately have diversified into Jewellery heists. This change in tactics has come about due to the fact that the banks don't have any money and are all up to their eyeballs in USD debt.

    I get my Koi to swallow the bigger gems, I have developed an infinite respect for these fish as a result. I gave up on using Karp, I'd get hungry and would swallow the gems, which I found excruciatingly difficult to pass, due to an inherited medical condition.
    Sunder likes this.
  23. reTRenD ^_^

    reTRenD

    reTRenD ^_^

    29,206 posts
    Since Jan 23, 2002
    What did you invest in that gave you almost 15% returns for nearly a decade? Has to have had a high risk element.

    People bang on about property as if it's some golden goose that can only go up. That's a big warning sign to me.
  24. Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    I'm surprised you're so positive on Big Data then .. I'd probably be more positive on companies licensing technology for use in automation.
  25. nise1

    nise1

    nise1

    2,486 posts
    Since Jul 24, 2005
    We are all in the valley of tears, in the part you're in the tears got dry and became silicon-like!
    So instead of being a high eyebrow why don't you share some useful tips, or you think this is a privilege gained solely for the ones that work there?
  26. reTRenD likes this.

    Ray Dalio

    Ray Dalio

    Ray Dalio

    3,036 posts
    Since Aug 1, 2016
    A lot of ppl don't realise property prices are only meant to go up in line with inflation, long-term.. So I'd draw a line on a chart and see where they're meant to be today (I'd guess a lot lower).

    37 years of falling interest rates will have created bubbles we're probably a bit oblivious to..
    reTRenD likes this.
  27. Ray Dalio likes this.

    reTRenD ^_^

    reTRenD

    reTRenD ^_^

    29,206 posts
    Since Jan 23, 2002
    Exactly it's an almost completely artificial market. Demand stoked by government lending and low interest rates and supply limited by planning permission.

    Buy to let margins are pretty thin, if interest rates went up I'd expect a flood of them to hit the market.
    Ray Dalio likes this.
  28. MiL0

    MiL0

    MiL0

    15,826 posts
    Since Jan 25, 2002
    Depends where you live. In my town, property prices have doubled in the last 5-6 years. It's not 100% safe, but neither is trading on the stock market. At least if my properties crash in value, I can still make a rental income from them. If you can show me a safer or easier way to make more money, feel free.
  29. MiL0

    MiL0

    MiL0

    15,826 posts
    Since Jan 25, 2002
    A lot of BTL investors are cash buyers.
  30. Noise-Signal Diphallic Dude

    Noise-Signal

    Noise-Signal Diphallic Dude

    2,643 posts
    Since Apr 2, 2014
    The short of it:
    Avoid being a "chartist" meaning you are trying to gauge futures through past trends of a stock and selling when those trends start to buck from some sort of statistician chart or diagram. Investment is about time so plan your gains for at least 5 - 10 years. Investment diversity is great so using a mutual find is probably a safe bet. As Ray/Swift recommended, Vanguard is a generally well performing fund with some lower associated costs than others. If you know nothing about investing than you probably should wait to enter into some future industry until you know the nature of it and the market itself. Blindly investing into anything just because it is associated with tech or automation will result in a loss really quick, just look at the events of the early 2000's and the dot com bubble.

    Speaking of that, research market bubbles. You may not learn to spot exact trends but you will gain an appreciation into how something becomes over valued. Even large "blue chip" companies have falling and caused a market crash. Knowing human behavior will help you a lot in later years once you have more knowledge.
Off-Topic